U.S. Hikes Visa Fees For Overseas Workers; Angers Indian Outsourcers

August 15, 2010

The outsourcing industry, one of India’s flagship industries, responded vehemently to a U.S. law that is designed to toughen the control of the Mexican border. It will also spike visa fees for American work visas. Many Indian IT graduates are employed on the work visa by companies in the U.S. India is among the top outsourcing locations and has dominated the outsourcing landscape for the last decade.

The law was inked into law by President Barack Obama and will increase visa fee by twofold for information technology workers coming into the U.S.

The legislation is a 600-million dollar bill and is an outcome of anger stoked by rising unemployment rates in the U.S.

Som Mittal, president of the National Association of Software and Services Companies (NASSCOM), the representative trade body Of Indian software exporters said, “The US is giving a very strong signal foreigners are not welcome.” Adding, “The law is discrimination,” the AFP reported.

Chandrajit Banerjee, head of leading business body the Confederation of Indian Industry said in a statement, “While the need to secure greater funding for strengthened security along the US-Mexico border is well understandable, illegal immigration issues are not linked to the temporary movement of skilled professionals.

Analysts say that India and the U.S. have been working together to form a ‘strategic partnership’ and a protectionist measure like this is not going to help define this partnership.

The U.S. law affects skilled employees who are imported to the U.S. by companies who have more than 50% foreign workers. This is likely to hit India’s IT and outsourcing industries since a number of U.S. firms outsource to India.

However, firms like Seattle, Washington based Microsoft are less likely to be hit hard by the law since most of their workforce is American.

According to statistics by NASSCOM, the spike in U.S. visa costs will account for an increase of 200-250 million dollars/year in the outsourcing industry.

Comments

There is no need for India to worry. Practically, the number of workers going to US from India will not decrease. Also, if it is difficult for workers to go the US, the work is anyway coming to India – not just business operations (BPO), Knowledge Process Outsourcing & Legal Process Outsourcing is on the rise.